Aide Warns Of Escalating Incinerator Costs

Satisfying all parties in the dispute over the two-county trash incinerator project in Bethlehem will cost the region a substantial amount of money - if the plant is built.

The fact that costs would be higher was underlined yesterday at the monthly meeting of the Lehigh Valley Solid Waste Authority, as Chairman Wendell Sherman said that resolving outstanding liability issues would require new landfill design and expansion.

The city also is looking for a substantial increase in the fee it is paid for dumping incinerator ash at the landfill. Both steps would boost the total price tag to Lehigh Valley residents.

Planning for the electricity-generating incinerator to serve Lehigh and Northampton county municipalities was cruising along neatly until June, when major snags developed over the fee Bethlehem would receive for depositing incinerator ash in the city landfill, and over liability issues involving potential environmental problems.

When negotiations with a private builder began late last year, the city wanted $18.50 for each ton of ash deposited in the landfill. But in May, the city, reflecting faltering support for the project from City Council and apparently the administration as well, increased its demand for depositing the ash to $30, authority officials confirmed yesterday.

The $30 figure "was the number which had been stated by a member of City Council designated as the spokesman," affirmed Sherman.

Council members charged at a June 24 meeting that the company, American Ref-Fuel of Houston, Texas, had continually increased its demands, and despite the support of the authority, which was created by the area's three major cities to develop an incinerator, council rejected a proposed landfill agreement that night on a 5-2 vote.

The price for dumping the ash is still being negotiated.

The liability issue centered around two primary factors, a $10-million fund that American Ref-Fuel's parent companies promised to post to back up the project, and concern by the company that it could be held liable for potential groundwater pollution originating from the contents of the existing World War II-era landfill. The company does not feel it should be responsible for pollution from pre-incinerator landfilling.

Ref-Fuel is a venture of Air Products and Chemicals of Trexlertown and Browning-Ferris Industries of Houston.

Sherman yesterday said the means for resolving the liability problems have centered on alternative landfill expansion design and materials - changes which could increase the landfill expansion price tag even more. The city realized two previous increases in the expansion estimate earlier this year.

In a discovery which nearly doubled the anticipated cost from $4.5 million to nearly $8 million, engineers found a misunderstanding in volume calculations by a consultant, which meant that a 40-acre expansion, rather than 25 acres, would be needed to meet the needs of the 20-year incinerator contract. The landfill is virtually full and must be expanded whether or not the incinerator is built.

Then in June, because of difficulties in topography and earth-moving logistics, the lone bid for the first phase of work, an initial 10-acre expansion, came in at $2.28 million, about $1 million more than estimated. That figure was later reduced to about $1.9 million through negotiations with the contractor.

Of American Ref-Fuel's position on the landfill liability issues, Sherman said yesterday, "They want more assurance in the (landfill) design than approved by the city and the state," the latter a reference to Pennsylvania Department of Environmental Resources (DER) regulations.

Essentially, the company wants a package of revisions to the landfill design that could include a different liner material, Sherman said. A plastic liner is currently specified, and several different plastics or other materials could be considered.

Design changes favored by Ref-Fuel could include installing liner material between the "old" and "new" dumping areas to distinguish the former area from the post-incinerator sections - with the intention of tracing the source of pollution. The company is also interested in separating the newly dug sections of the landfill, to be built in separate construction phases, Sherman said.

He said the added costs of such changesare still being determined, and he declined to make an estimate. The project cost prior to the landfill contract dispute was estimated at $115 million.

Authority Vice Chairman Donald Bernhard said the company has agreed to drop a provision in the $10-million parent-company guarantee which had called for the amount to be reduced by $400,000 per year.

Ref-Fuel, Bernhard said, has also offered compromise figures for the ash- tipping fee, which he declined to specify. He added that the city has not yet responded officially to the latest company offers.

Even if a compromise is reached, the higher ash-disposal fee the city wants and the landfill changes sought by the company are likely to increase the cost to the users of the plant - anticipated to be virtually all of the 62 municipalities in the two counties. Such increases would be passed on through the garbage processing or "tipping" fees to be charged by the authority, officials said.

Because of the halt in progress just before an anticipated contract agreement, $100 million in tax-free bond financing allocated the project by the state was revoked July 1 by the Department of Commerce, placing the incinerator, once seen as virtually a sure thing, in jeopardy. The authority hopes to regain the allocation if the problems can be resolved. Negotiations between the company, city and authority are continuing, though vacations have slowed the meeting process in the past few weeks.